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BlackThorn Emerges With $40M, New Weapons Against Neuro Disorders

Thu, 10/20/2016 - 09:55

For three years, a group of investors and experienced neuroscience executives have been stealthily advancing one of the more ambitious new startups in neurology, called BlackThorn Therapeutics. Today they’re finally shedding a little light on what they’ve been up to.

As Xconomy reported last year, South San Francisco, CA-based BlackThorn was spun out of Scripps Research Institute, which on its website lists the company as one of its 2013 spinouts. It was seeded by Arch Venture Partners, which has a track record launching ambitious biotech firms with massive rounds of funding, like Juno Therapeutics (NASDAQ: JUNO) in 2013 and another neuroscience firm, Denali Therapeutics, last year.

Today, BlackThorn is making its first formal announcement. It’s closed a $40 million Series A round led by Arch, with participation from the venture arm of Johnson & Johnson, Alexandria Real Estate Equities, and several other investors. It’s also disclosed plans to develop drugs for neurobehavioral diseases—such as obsessive compulsive disorder, depression, and schizophrenia—and test them in a way that its executives believe can help overcome some of the field’s notorious roadblocks.

Developing drugs for neurobehavioral diseases is difficult for a number of reasons. Much remains unknown about the underlying biology of diseases like autism, for instance, and tests of drugs for schizophrenia and depression often give different results from trial to trial, often because of a strong placebo effect. This year alone, antipsychotic drugs developed by Alkermes (NASDAQ: ALKS), Intra-Cellular Therapies (NASDAQ: ITCI), and the now-defunct Forum Pharmaceuticals have failed Phase 3 trials, and all three cited a high level of placebo effect in the control group as a significant problem.

Compounding the difficulty is the lack of reliable indicators, what are known as “biomarkers,” that a patient has say, schizophrenia or depression, or that a drug is actually affecting his or her disease. A drug’s effects in a clinical trial must be measured by observations of mood or behavior, documented by clinicians or via standardized questionnaires—a process that is less precise than running a blood test or a scan, as a company might do to test the effects of a drug for, say, heart disease.

“There is no such toolkit for [neurobehavioral diseases] yet,” says Scott Forrest (pictured), BlackThorn’s VP of corporate development. “It’s emerging from clinical research.”

BlackThorn’s contribution to the toolkit is called Inform, a method of, as it says in a press release, “linking brain physiology to behavior.” Forrest says Inform is a combination of imaging tools and behavioral evaluation techniques—some of which are proprietary, others aren’t—meant to help it both find drug targets important in neurobehavioral diseases, and figure out which subsets of patients might best respond to its drugs.

The hope is that by better identifying and understanding these patient groups, BlackThorn will be able to develop targeted drugs to alter specific behaviors, and then run smaller, more efficient clinical trials with a higher chance of success than is typical in the neurobehavioral field.

“You wouldn’t take all comers who have cancer” in a cancer drug trial, Forrest says. “You would segment [them] by the biology in some way. It’s similar here. Unless you learn about the patients and do so in a way that allows you to target the right treatments to those patients, you’re basically consigning yourself to the track record of the past in this field, which we all know has had significant challenges.”

BlackThorn is on the verge of the first key test of its approach. The company’s scientific founders at Scripps, Edward Roberts and Hugh Rosen, discovered a drug that blocks the activity of a protein called nociceptin receptor which is involved in a variety of emotional and behavioral changes. (Roberts and Rosen were also co-founders of the recently-acquired drugmaker Receptos.) Known as BTRX-246040, the drug has already been tested in early studies and is set to begin a Phase 2 program next year. Forrest says the company has a total of four drug programs currently underway, and the second of them should begin human trials next year as well.

Typically mid-stage trials test a variety of doses of a drug, and measure its safety and effectiveness against a specific disease. In the Phase 2 studies of BTRX-246040, Forrest says … Next Page »

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Arterys, GE Healthcare to Roll Out Next-Gen MRI Scans of Heart

Wed, 10/19/2016 - 14:09

The healthcare tools of the future often start as research projects in academic medical centers, but they may not break out into widespread clinical practice until some sort of logjam gives way to make them workable and affordable.

GE Healthcare, a unit of Boston-based industrial giant General Electric, recognized some limits on MRI scanners like its own, and started collaborating with Stanford University physicians more than five years ago on next-generation MRI technology to better diagnose people with heart disease. The new scans resulting from this work show a patient’s beating heart like a 3D animated movie—and the image can be rotated and viewed from any angle. Up until now, these scans have been used only at Stanford and nine other medical research centers.

Chicago-based GE Healthcare is now about to go to market with the new magnetic resonance imaging technique. But it took several extra layers of technology, and a collaboration with San Francisco startup Arterys, to make that possible. That’s because GE Healthcare, by tweaking its traditional MRI scanners, was capturing so much raw data on the heart that on-site hospital scanners and computers couldn’t assemble it into images that doctors could intuitively interpret.

To solve that problem, Arterys tapped into technologies used to develop three-dimensional video games like “Super Mario 3D World.” Arterys feeds the gigabytes of MRI information into its Web-based software application, which takes advantage of the outside computing power now broadly available from the network of servers-for-hire we call “the cloud.” Those servers rely on specialized logic chips called graphic processing units or GPUs, which are commonly used to produce 3D animations.

Less than five years ago, those GPUs weren’t available from commercial cloud services, says Arterys co-founder and chief technology officer John Axerio-Cilies.

“In 2012, when we started, Amazon had just released the GPUs into the public cloud,” Axerio-Cilies says. That opened a door for GE Healthcare’s next-gen cardiac MRI. Arterys uses Amazon’s Web servers to analyze data from the scans. “A nexus of events in just a couple of years allowed this to happen,” he says.

The commercial debut of the new GE Healthcare system will mark an industry milestone, partners in the collaboration say.

“This is one of the first applications of cloud computing in a clinical application,” says Arterys CEO and co-founder Fabien Beckers.

A product version of the new MRI system, dubbed ViosWorks, will be placed in ten pilot sites before the end of the year. Plans are to make it commercially available in 2017.

GE Healthcare will be the first MRI vendor to shift its data processing to the cloud, says Eric Stahre, CEO of GE Healthcare’s MR unit.

“It’s the first example of where we’re going as a company,” Stahre says. “We see this as the first of many.”

In addition to its work on MRI, GE Healthcare has looked to enhance other medical imaging technologies through computing power. In one project, the GE division’s IT team has written software to speed up the processing of data from CT scans of the brain so that doctors can make quicker treatment decisions for suspected stroke victims.

GE Healthcare’s CEO John Flannery has predicted a 50-fold increase in the flow of data from healthcare devices by 2020. To handle that flow, the company late last year announced the creation of GE Health Cloud, a Web-based data processing and treatment collaboration platform that it says can connect to more than half a million of its imaging devices. The company is inviting 3D medical imaging developers to work within the platform.

The data processing for ViosWorks scans will eventually be shifted from Amazon’s servers to GE Health Cloud. The “4D Flow” system captures as much as five gigabytes of data, compared to about 100 megabytes in a conventional MRI scan, Beckers says.

The U.S. Food and Drug Administration has cleared both the Arterys and GE Healthcare elements of the system for the U.S. market, the companies say. Stahre says GE Healthcare is to begin its marketing rollout of ViosWorks next month.

The next hurdle will be to persuade doctors and medical insurance companies that the more elaborate scans will improve diagnosis enough to lead to better patient outcomes.

“You still have to prove your worth,” Stahre says.

Here’s the problem GE Healthcare and its research partners were trying to solve when they … Next Page »

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All In One Place: A New Immuno-Oncology Trial Resource

Wed, 10/19/2016 - 11:00

More than 100 years ago, New York bone surgeon William Coley began to suspect that bacterial infections might be improving the outlook for patients also suffering from cancer. The infections were turbo-charging the immune system.

Coley (pictured) would be gratified to see that in 2016 a growing array of immune-boosting cancer treatments are helping some patients in dire straits, including former U.S. President Jimmy Carter, who fought off a life-threatening skin cancer with the help of a new immunotherapy drug. That’s only one patient and one response; hundreds of other people have been through clinical studies. The pool of data reflecting their experiences and their outcomes is expanding, seemingly day by day. But those data are impossible to find all in one place.

As reporters, we find that frustrating. Perhaps you do, too. So we’ve begun this project: a cancer immunotherapy resource that will grow as the data pool grows. We’re aggregating all the trials we can find that have patient outcomes: whether a treatment made people better, and for how long.

We’re doing this in two steps. First, we’re rolling out data for treatments that use live T cells, modified outside the patient’s body to hunt and kill tumor cells more efficiently, then infused back into the patient. Most of these treatments are a patient’s own cells and are known as CAR-T (chimeric antigen receptor T cell) therapies. They have been successful in a small set of blood-borne cancers, but many of the initial stunning results are blunted by the cancer clawing its way back. “Despite high rates of … remission, relapse is a significant [cause] of treatment failure,” wrote Rebecca Gardner of Seattle Children’s Research Institute and her colleagues this year in describing the results of one of their CAR-T studies. Nearly all the 36 kids treated went into remission at first, but the rate of remission after a year was down to 53 percent.

We acknowledge that what we present here only scratches the surface of each trial. To delve into the complexity—the severity of the side effects, for example, or the need to supplement the T cell therapy with bone marrow transplants or chemotherapy—follow the links to the description or papers that contain the results.

We also acknowledge that this table should not be used to compare trial to trial. Instead, use it as a quick overview to see, for example, that CAR-T therapies have had incredible early success treating kids with acute lymphocytic leukemia (ALL), a fast-growing blood cancer that often resists traditional treatments. Adults with ALL have fared well, too, but not as well as kids. Big trials that could lead to regulatory approvals are underway but have yet to divulge data.

Non-Hodgkin lymphoma (NHL), a wide range of lymph-related cancers, is another big CAR-T target because NHL tumors share a protein, called CD19, with ALL and other leukemias that the modified killer T cells can be engineered to sniff out. Kite Pharma (NASDAQ: KITE) of Santa Monica, CA, could have the first approved CAR-T if a big NHL trial holds true to the promise of interim data that Kite released in September.

The first returns are trickling in from a smattering of engineered T cell trials in other blood-borne cancers, such as multiple myeloma, and solid-tumor cancers (lung, breast, etc.). We’ll compile those here, too.

Part two of this project, coming soon, will be a separate table of a … Next Page »

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The Power of the Cloud for Life Science R&D

Wed, 10/19/2016 - 09:43

“In the new world, it is not the big fish which eats the small fish, it’s the fast fish which eats the slow fish…” — Klaus Schwab, Founder/Executive Chairman, World Economic Forum

Over the past decade, the nature of innovation has changed—even as the pace has substantially increased. One of the reasons has been the ability to collect and analyze vast amounts of digital data, transforming industries from transportation and finance to defense and manufacturing. In R&D-intensive industries like biotech and pharma, data have always been critically important. Until recently, however, the full potential of that data has not always been realized, given the quantity, variety, and disparity of sources. But now that’s changing, because of the power of cloud-based software.

Unlike traditional software, cloud-based software is deployed on a central server and ‘rented’ by each organization or scientist as needed. That offers a number of advantages. Using the cloud, newly purchased software can be set up in a matter of minutes, instead of taking weeks. Software that uses cloud-based infrastructure also means customers can store and analyze a nearly infinite amount of data at low cost. Furthermore, improvements can be made instantaneously when new features are developed, ensuring that customers receive new functions and upgrades immediately.

While all industries gain from these general advantages of cloud software, the life sciences will also see unique benefits. In particular, cloud adoption in the life sciences offers seamless collaboration, improved operational efficiency, experimental automation, and advanced analytics.

Cloud-based collaboration

Science is all about data. Yet the methods we’ve used in the life sciences to produce, manage, collaborate around, and analyze data haven’t changed much in decades. Typically, we end up with breadcrumb-like trails of data in numerous different locations and formats—written in lab notebooks, files on USB drives, or notes in an ELN (electronic laboratory notebook). For projects that are distributed (such as between a client and a contract research organization), global (such as large pharma), or being transferred (e.g. discovery chemistry to scale up), this diaspora of data is a major bottleneck.

Cloud-based software solves this problem. All of the data are in the same place. Every bit of the data is easily accessible by all collaborators.

The benefits are substantial. Companies anywhere in the world can easily and securely access data no matter where they were generated. The companies also can maintain a single repository of record and enable different stakeholders to provide inputs on the same data set. Using the cloud, collaboration becomes a central pillar of the R&D landscape. Two fast-growing providers of cloud-based data management software that do this well are Benchling and Ovation.

Experimental workflows

Traditional R&D is labor intensive. Scientists do experiments at the lab bench, operating their instruments in person and collecting data on paper or a USB drive. The need to manually collect data and push buttons severely limits productivity and contributes to irreproducibility.

Cloud-based software can dramatically change the way scientists perform experiments by connecting individual scientific instruments directly to the cloud. That capability enables value-added functions like remote control, feedback loops, and the integration of instruments from multiple vendors without expensive, custom-built software. It also makes it much easier to automate experiments. Since all data and events are logged, experimental records provide complete visibility across the entire workflow and project.

Operational efficiency

R&D, like any business process, is dependent upon the production of high-quality data. In the case of the life sciences, scientific instrumentation is half of the data-producing pie. (People are the other half.) Yet the way we maintain and manage instrumentation is plagued with inefficiencies. Those inefficiencies include instrument downtime, limited availability, and untracked assets.

I have seen too often the crippling effects of instrument problems on discovery projects. A malfunctioning piece of equipment can delay projects by 1-2 months, depending upon servicing times. Just two weeks of instrument failure can lead to delays that cost up to $200K per time-sensitive project.

Cloud-based software and sharing of operational data can remedy this issue, by providing greater visibility across the enterprise and with external vendors. A good example of how cloud-based technology can improve operational efficiency is via remote diagnostics, such as the services from Agilent. Remote Advisor (RA) is one way many users of Agilent-manufactured equipment improve instrument up-time and track consumable use.

Advanced analytics

A critical part of any scientific experiment is the analysis. In the traditional R&D paradigm, the amounts of data are small enough that they can be managed easily by an individual and common PC-based software (e.g. Excel). However, in the modern era of research, a single scientist produces far more data than can be processed and visualized using these traditional methods.

Cloud computing provides a unique technical solution for dealing with this deluge of data. Large data sets can quickly be stored and analyzed on-demand. That’s been especially valuable in areas like genomics. DNA is both information dense and information rich. As a result, a genetic sequence produces huge amounts of data that cannot easily be managed on-premise. Furthermore, many of the insights into DNA arise from analyzing numerous sequences. One of the largest players in this space is Illumina. Their flagship cloud offering is BaseSpace. An expandable repository for data, BaseSpace also offers numerous applications (akin to an iPhone’s App Store) that can analyze data produced by Illumina machines.

A cloud-enabled future

Speed is the name of the game. In the modern life sciences environment, those who are the fastest to produce, analyze, and make decisions from data will be the winners. The challenge has been that historical computing approaches have limited the pace with which a scientist, a department, or a company can innovate.

Cloud-based software promises to accelerate time-to-completion for projects. It promotes collaboration, improves operational efficiency, enables the automation of experiments, and facilitates sophisticated analytics. Furthermore, a future in which experimentation is aided by cloud software inspires us to consider the promise of machine learning and artificial intelligence (AI) as well.

We have seen the disruptive power of these computing paradigms in other areas and predict that the impact will be substantial in life sciences as well. Imagine an AI program that dynamically improves the yield of small-molecule API synthesis, or a machine learning-based system which infers the composition of a sample by comparing chromatographic signatures to a database of historical samples, or an algorithm that predicts when an instrument is out of range or about to fail, before it actually does. This is the future for R&D that is enabled by cloud software.

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After “Hubris” and Its HCV Collapse, Can Vertex Avoid Same Mistakes?

Tue, 10/18/2016 - 07:50

Five years ago, in November 2011, a company from Princeton, NJ, called Pharmasset shared news that would have an impact on millions of people around the world with hepatitis C. Its experimental drug PSI-7977 had quickly cleared the virus from 40 patients, with minimal side effects, and they had stayed infection-free. If the data held up in wider testing, it could mean that hepatitis C could be cured someday with a short course of pills, without the flu-like symptoms that dogged regimens of the past.

“It was absolutely the biggest deal,” says Durhane Wong-Rieger, a longtime hepatitis C patient advocate who now runs the Canadian Organization for Rare Disorders. “It was the evidence we’d all been looking for.”

Officials at Vertex Pharmaceuticals (NASDAQ: VRTX), who were planning a move from Cambridge, MA, into a new $800 million headquarters with views of Boston Harbor, should have seen something much different in those Pharmasset data: An oncoming freight train. According to Vertex’s CEO, Jeff Leiden, then just a Vertex board member, not everyone did.

With what Leiden (pictured) now calls “hubris” and “blindness,” Vertex failed to react quickly enough. Its own hepatitis C drug was crushed. In three years, Vertex went from having a billion-dollar hepatitis C business to zero—abandoning the research completely.

Now Vertex has another flagship franchise, consisting of two drugs approved for the rare and deadly disease cystic fibrosis and perhaps more on the way. Sales of both drugs, ivacaftor (Kalydeco) and the combo pill ivacaftor-lumacaftor (Orkambi), reached almost $1 billion in 2015 and are growing. But the drugs aren’t cures, and competition looms.

Has Vertex learned from its past missteps? “They are on more solid footing than they were, but there’s no such thing as solid footing in this industry,” says Rajeev Shah, a managing director at biotech investment firm RA Capital, which had been a Vertex investor but no longer is. “The moment [a company] becomes a little passive and unaware of the hundreds of threats coming at it is the moment that it risks being extinct.”

Six months before the Pharmasset data release, Vertex had won FDA approval of telaprevir (Incivek), which was a big advance in the treatment of the liver-damaging hepatitis C virus (HCV). Vertex began as a bootstrapped startup in 1989 and was on its way to being a profitable enterprise that helped thousands of patients with a devastating disease. Telaprevir sales rocketed to nearly $1 billion in the first six months, at the time the fastest drug launch ever.

But the Pharmasset data came out, and Gilead Sciences (NASDAQ: GILD), looking to build upon its lucrative portfolio of HIV treatments, pounced. It bought Pharmasset in November 2011 for $11 billion and continued PSI-7977’s stellar run of clinical data. Called sofosbuvir (Sovaldi), the drug won FDA approval in December 2013. With evidence of up to 90 percent cure rates in three months and a very clean safety profile, sofosbuvir quickly made telaprevir obsolete.

Other similarly effective HCV drugs have followed. Telaprevir’s sales cratered, and Vertex axed 15 percent of its workforce in October 2013. In August 2014—just six months after moving into its new glass towers—Vertex announced plans to take telaprevir off the market. Then it exited HCV research entirely.

“It was absolutely a neck snapping phenomenon,” says Leiden.

Yet it wasn’t a fatal blow. Thanks to foresight, luck, and no small amount of help from a nonprofit foundation, Vertex had a Plan B that turned into a lucrative Plan A.

The company won approval in January 2012 of ivacaftor, the first drug to directly address the molecular malfunction that underlies the deadly disease cystic fibrosis (CF), which causes thick, sticky mucus to clog the lungs. Ivacaftor-lumacaftor followed three years later. Vertex has reinvented itself as the leader for CF treatments.

“We’re a very, very different company than we were four years ago,” says Leiden. “We’ve learned a lot from that experience.”

Vertex started out as an early believer in “rational” drug design—building drug molecules to fit the structure of specific biological targets, like a lock and key. Vertex went public in 1991 and used its discovery tools on one project after another, from immunosuppressive drugs for organ transplants, to HIV drugs, to HCV medicines. Its acquisition of Aurora Biosciences in 2001, and a critical $150 million in research funding from the Cystic Fibrosis Foundation (which just committed another $75 million to the company last week), led it to CF. Much of that narrative was captured in two books about Vertex, The Billion Dollar Molecule from 1994 and its 2014 sequel The Antidote: Inside the World of New Pharma, both by veteran journalist Barry Werth.

In its early days, Vertex helped bring two HIV drugs to market. But it never turned a profit and ended up selling its rights to the drugs. Meanwhile, Vertex continued to … Next Page »

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Ex-Celgene Dealmaker Tom Daniel Charts a New Course Advising Biotechs

Mon, 10/17/2016 - 07:50

For close to a decade, Tom Daniel and George Golumbeski comprised perhaps one of the best-known dealmaking duos in biopharma, striking a slew of alliances that established Summit, NJ-based Celgene as one of the more creative, nimble biotech partners in the business.

“We think alike,” Daniel says. “We can pretty much finish each other’s sentences.”

No longer. Xconomy has learned that Daniel stepped down from his role as president of research & early development at Celgene (NASDAQ: CELG) over the summer, a position that has since been filled by Rupert Vessey. Daniel is now the founding executive director of what he calls a “shell” advisory group in San Diego named Catalysis Advisors, from which he’s advising some biotechs and venture firms and acting as a “founding consultant” to other startups.

“I’m still in the game,” Daniel says, “just trying to create a bit of a different role.”

Daniel says that exact role is something he’s figuring out as he goes, but he definitely won’t be a hands-on operational executive as he was in the past at Celgene, Ambrx, Amgen (NASDAQ: AMGN), and Immunex before that.

For now, he’s working with venture capitalist colleagues on some new companies that have yet to be officially launched. He’s joining the board of a nascent startup in Boston (he wouldn’t disclose the name) that is working in a space that is “highly complementary” to the advancing cell-based, CAR-T cancer immunotherapy treatments, he says. Another new startup he’s involved with is focused on the neurobehavioral field, he says. Daniel is also on the boards of Juno Therapeutics (NASDAQ: JUNO) and Zafgen (NASDAQ: ZFGN), and still contributes to some of Celgene’s scientific work.

“For me, this is a rich time to think ahead, try to figure out how the forces will play out over the next decade and where to try to contribute,” he says.

Daniel joined Celgene in 2006. Golumbeski (then the head of business development and now Celgene’s executive vice president) followed three years later, and the two became the chief architects of what’s become a sprawling network of collaborations with early-stage biotechs. Under their watch, Celgene became known for its creative alliances, customizing deals with young biotechs to fit each specific situation, rather than following a standard template. These partnerships were a mix of option-to-buy deals, broad alliances on a variety of drugs, and more, but the common theme was a hands-off approach that left the smaller company enough freedom to share in its own upside. (For more, check out this chat with Golumbeski about Celgene’s dealmaking strategy back in 2013.)

“We never had the big company hubris about our collaborators,” Daniel says. “George and I worked very, very hard to create relationships with people first with whom we had affinity, and secondly in such way that both sides really saw the win-win.”

As a result of that flexibility, Celgene got in early on a variety of biotechs that since become publicly traded companies with promising futures. Among them: Agios Pharmaceuticals, Acceleron Pharma, Bluebird Bio, and Juno. Celgene’s pipeline is littered with experimental drugs that are a result of these tie-ups, and many of them are progressing their way through the clinic. Celgene, for instance, has said it intends to file for FDA approval of enasidenib, an experimental cancer drug discovered by Agios, by the end of the year.

Daniel looks to the 2009 Agios deal, a wide-ranging collaboration that included a $130 million upfront payment—a significant amount considering Agios was years away from its first clinical trials—as the bellwether deal from his tenure. Celgene spent plenty of time negotiating with the Agios team and figuring out how to construct a deal that would represent a big bet on early science while best respecting Agios’s boundaries and motivations, he says. Celgene later did some things Daniel called unusual, such as helping set up opportunities for Agios to get more funding, he says.

“Every company kept coming in telling us they wanted an Agios-like deal,” Daniel says.

Daniel left Celgene in July because he felt that he’d accomplished many of the goals he’d set out. He spent a long time trying to recruit Robert Hershberg, the co-founder of VentiRx Pharmaceuticals (another Celgene partner) who is now Celgene’s chief scientific officer, and Vessey to replace him. He enjoys working with small, focused companies rather than managing large portfolios as he did at Celgene.

“A decade is a long time in a role,” he says. “I think the organization needed some fresh blood.”

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With $30M Infusion, Certona Aims for Bigger Share of Digital Retail

Mon, 10/17/2016 - 03:41

After raising $30 million, San Diego-based Certona said it is moving to accelerate its product development, expand its sales and marketing team, and improve its client services as an e-commerce technology vendor.

If online retailing is one of the most tumultuous and fast-changing corners of the Internet, the growth of marketing technologies that retailers use to serve their customers and to personalize their shopping experience has been an even wilder ride. Certona describes itself as an “omnichannel” vendor—meaning its technology enables retailers to collect consumer data across online, mobile, e-mail, call center, and in-store interactions. Certona uses the data to offer shoppers personalized options based on “real-time profiling.”

In a recent interview, Certona CEO Meyar Sheik said the company has taken a measured approach since he founded Certona in 2004 with CTO Geoffrey Hueter. The company now has about 130 employees, and counts Petco, Advance Auto Parts, Pier 1 Imports, and Charlotte Russe among its 500-plus retailer customers in over 70 countries.

Unlike many of its rivals, Sheik said Certona had raised a total of only $7 million in venture capital (in 2008) from ABS Ventures of Waltham, MA, and San Diego’s Express Ventures. “We’ve been fairly capital-efficient in this fast-growth e-commerce space,” Sheik said. “It wasn’t about raising multiple rounds and burning jet fuel. It has allowed us to scale in a very measured way.”

In contrast, San Francisco-based RichRelevance, founded in 2006, has raised nearly $102 million from 11 investors through nine funding rounds, according to CrunchBase. ExactTarget, another rival that was founded in 2000 in Indianapolis, IN, raised over $188 million in venture capital funding before going public in 2012—and getting acquired by Salesforce in a 2013 deal valued at $2.5 billion. Salesforce added another digital commerce giant earlier this year with the acquisition of Burlington, MA-based Demandware in a deal valued at roughly $2.8 billion

It also is a burgeoning sector. The Internet Retailer Conference & Expo set for Chicago next June lists over 600 exhibitors, including Adobe Systems, Certona, Episerver, and Kibo Software.

Sheik, who was previously the chief marketing officer and COO at San Diego’s WebSideStory, said the sector has exploded in recent years as Certona and its rivals have combined the capabilities of traditional Web analytics with predictive analytics software, machine learning, and artificial intelligence.

“When you get all that data and analyze it, you get interesting insights,” Sheik said. “It’s really about understanding visitor behavior and using that to understand and improve” the performance of e-commerce websites.

To compete in such a big and robust market, Sheik said Certona’s “fundamental difference is our focus, deep specialization, and a track record where we can demonstrate incremental performance improvements and a proven, scalable technology platform.”

The $30 million that Certona raised recently from the growth equity firm Primus Capital will enable Certona to add new capabilities to its Web-based platform and expand into new markets and geographies.

As a business-to-business technology provider, Sheik said he sees new market opportunities for Certona in other sectors, such as the travel and hospitality industries, and “wherever anyone wants a better [online shopping] experience. The differentiator is going to be customer experience.”

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Bio Roundup: Bristol & Illumina Blues, Sickle Cell News & More

Fri, 10/14/2016 - 10:00

On Aug. 4, shares of Bristol-Myers Squibb closed at $75.32. Today, shares are worth just over $50. That means in three months, Bristol has lost a third of its value, equivalent to about $40 billion in market capitalization. The reason? One failed clinical trial has left rival Merck in the lead position to have what could be part of the new standard of care for lung cancer. That story and plenty more in this week’s roundup.


—The European Society of Medical Oncology held its annual meeting in Copenhagen, and the meeting featured updates on heavyweight immunotherapy programs, potential options for patients with advanced breast cancer, and more. Some of the big headlines from the meeting included the latest data on a prospective ovarian cancer drug, niraparib, from Waltham, MA-based Tesaro (NASDAQ: TSRO), and results from Merck’s (NYSE: MRK) pembrolizumab (Keytruda) in newly diagnosed lung cancer patients. Merck’s data sent immunotherapy rival Bristol’s shares down more than 10 percent, while Tesaro’s shares gained 17 percent over the week.

—Shares of San Diego-based Illumina (NASDAQ: ILMN) fell more than 32 percent after the next-gen sequencing giant slashed its revenue projections once again. Illumina fended off a hostile takeover bid from Roche back in February 2012, and over the next three years shares went from about $51 apiece to as high as $219.30 in July 2015. But sagging sales have sent Illumina far down from last year’s peak. Here’s more from CNBC.


—Researchers at UCSF Benioff Children’s Hospital Oakland, the Innovative Genomics Initiative of Berkeley, CA, and the University of Utah have made progress on a gene-editing treatment for sickle cell disease. The work used CRISPR-Cas9 to fix a genetic mutation in human bone marrow cells that were transplanted into mice. It remains years away from human testing.

—Cambridge, MA-based Bluebird Bio (NASDAQ: BLUE) has made technological improvements to the process it uses to manufacture gene therapies. They’ll be incorporated into Bluebird’s current and future trials, which Bluebird hopes might help it overcome some of the limitations it’s seen so far in gene therapies for sickle cell and beta-thalassemia.


—Cambridge and Basel-based CRISPR Therapeutics, which could go public next week, aims to raise $75 million by selling 4.7 million shares at $15 to $17 apiece.

—Cancer drug developer Accelerated Pharma, based in Westport, CT, outlined terms for a $17 million IPO.

—AzurRx Biopharma (NASDAQ: AZRX), which has an executive office at SUNY Downstate’s biotech incubator in Brooklyn, raised $5.3 million in an IPO.


—Zymergen of Emeryville, CA, raised a $130 million Series B round for its biological manufacturing business. It engineers microbes to produce chemicals for a range of industries. The round was led by Japan’s SoftBank Group.

—Boston-based healthtech startup Iora Health raised a $75 million Series D round led by Singapore-based Temasek. Here’s more on the startup, which runs primary care clinics imbued with software that helps track patients’ health.


—New York-based Intercept Pharmaceuticals (NASDAQ: ICPT) said that the Committee for Medicinal Products for Human Use has recommended conditional approval of obeticholic acid (Ocaliva) in Europe to treat patients with the rare liver disease primary biliary cirrhosis. The drug is already approved to treat PBC in the U.S.

—Adaptimmune Therapeutics (NASDAQ: ADAP) said Wednesday it has changed the protocol for its ovarian cancer treatment in a Phase 1/2a trial. The stock price was down 10 percent as of Thursday’s close.

—Regeneron Pharmaceuticals (NASDAQ: REGN) will team with Ocular Therapeutix (NASDAQ: OCUL) to develop a long-lasting version of its flagship eye drug, aflibercept (Eylea).

Alex Lash contributed to this report

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Qualcomm Rolls Out First Commercial Use of Wireless EV Charger

Thu, 10/13/2016 - 12:52

Qualcomm (NASDAQ: QCOM), the San Diego wireless technology giant, announced in a blog item this week that its Halo wireless electric vehicle charging technology will be available commercially for the first time in 2017, with the mid-year introduction of the 2018 model of the Mercedes-Benz S550e.

Daimler AG introduced its first plug-in hybrid model in the U.S. last year, the 2016 S550, which combined a V-6 gasoline engine with an integrated 85-kilowatt electric motor and an 8.6 kilowatt-hour lithium-ion battery pack (and was priced at $95,325). The charging cable plugs into a socket on the right rear bumper.

The new S550e also is outfitted for wireless charging, which enables the driver to charge by simply parking the car directly over a wireless charging pad. The system, licensed by Qualcomm to an unidentified “Tier 1 power electronics supplier,” uses resonant magnetic induction technology that transfers energy from a mat on the ground to a receiver in the car with no strings or power cables attached. Just “park it and charge it.”

But can’t a hybrid electric car also recharge itself by simply driving around?

In response to questions from Xconomy, a spokesman for Qualcomm explained in an e-mail:

“The s550e is a plug-in hybrid electric vehicle (PHEV), which means that the traction battery used to power its motors can be recharged by connecting the car in to an external source of electric power. PHEV batteries [also] can be topped up from the internal combustion engine, but this removes the zero emission benefit. PHEVs therefore still need to be charged from the grid while parked to ensure optimal zero emission performance.”

According to Qualcomm, its Halo wireless electric vehicle charging systems have been integrated and successfully tested on a number of different vehicles, including the Renault Fluence; Nissan Leaf; BMW i3; BMW i8 and Honda Accord.

The Qualcomm Halo 7.4 kW systems also are integrated into Qualcomm-sponsored safety cars used in the FIA Formula E racing circuit.

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California Accelerators Enroll Startups Targeting Cannabis Industry

Wed, 10/12/2016 - 17:06

[Corrected 10/13/16, 9:10 am. See below.] When California voters go to the polls on November 8, among the many issues they are expected to decide is Proposition 64. If a majority of voters vote yes, the initiative would legalize the recreational use of marijuana in the Golden State for adults aged 21 years or older.

Some entrepreneurs, though, are acting as if Prop 64, known officially as the California Marijuana Legalization Initiative, has already passed.

On Monday, nine startups began a 16-week program at Canopy San Diego, a new accelerator program for seed-stage companies developing new technologies, products, and services to support the legal cannabis industry. Co-founder and CEO Eric Gomez said Canopy San Diego won’t enroll startups or entrepreneurs who are directly engaged in the cultivation or sale of marijuana or its derivatives.

“We’re focused on the picks and shovels, the tents and Levis,” Gomez said, likening their role in the budding legal cannabis business to the merchants who got rich selling gear to the miners during the California gold rush.

“We like what Eric calls the boring back-end software,” said co-founder and managing director Jack Scatizzi, referring to a company’s internal, business-related software and the operating system that controls how a consumer-facing website operates.

Gomez said he was inspired to start Canopy San Diego after spending time at CanopyBoulder, the cannabis industry fund and accelerator founded in 2015, less than three years after Colorado voters approved a similar marijuana legalization initiative. The Boulder-based accelerator expanded this year to Northern California, and enrolled its first nine startups in Berkeley on August 29.

While the Colorado-based founders are overseeing the new Berkeley accelerator themselves, they agreed to a franchise deal with Gomez for Canopy San Diego, said Micah Tapman, a CanopyBoulder co-founder and managing director. He gave a business presentation to Canopy San Diego’s first class Monday, and has been working with Gomez and Scatizzi to standardize the franchisee’s program and processes.

In founding CanopyBoulder, Tapman said he and co-founder Patrick Rea were struck by the phenomenal growth of the cannabis industry.

[Revised to clarify that Canopy did not alone invest all $14 million] In Boulder, Canopy is in the middle of its fourth cohort, Tapman said. The Colorado accelerator has enrolled 38 portfolio companies so far, and they have raised a total of $14 million. Tapman counts three portfolio companies as failures, and said there have been no exits so far—but the cannabis industry in Colorado is on track to grow by 30 to 40 percent this year.

“Until California legalizes, we’re still operating in a kind of purgatory,” Tapman said. “But once you have the world’s eighth or ninth largest economy legalize, it is going to drive this industry.”

A poll released in mid-September found that a clear majority of California voters support marijuana legalization, and Prop. 64 is expected to pass. And in fact, California surpassed France as the world’s sixth-largest economy, based on 2015 economic data.

With recreational marijuana use legalized in Alaska, Colorado, Oregon, and Washington, legal cannabis sales in the United States totaled $5.7 billion in 2015—a number estimated to grow by 25 percent this year to $6.7 billion, according to ArcView Market Research. (The ArcView Group is a partner in CanopyBoulder). By 2020, the cannabis industry is projected to hit $21.8 billion.

“It’s a cash crop,” Tapman said, referring to an agricultural crop that is easily marketable, and grown more for its commercial value. But marijuana hasn’t benefitted from the kind of innovation in technology and cultivation that agriculture has applied to tobacco and other cash crops, Tapman said.

State regulations in Colorado also prohibited anyone who has not been a Colorado resident for at least two years from investing in marijuana cultivation, processing, or retailing, Tapman said. “We were driven by the regulations to create [ancillary] businesses so we would not have to police our investors,” Tapman said. But such regulations have not limited Canopy’s opportunities.

If Canopy startups can figure out how to shave 10 percent off the marijuana growth cycle, or to save 10 percent on water used for irrigation, Tapman said they would have created profitable technologies that could be applied to other agricultural crops.

In San Diego, Gomez said each startup that enrolls in the accelerator program gets a $20,000 investment that encompasses seed capital, office space, and mentoring services in exchange for an equity stake that ranges from 6 percent to 9.5 percent. Three companies from each cohort also will get $50,000 in follow-on funding.

Entrepreneurs at work on first day of Canopy San Diego accelerator program

In addition, individual investors in Canopy San Diego’s fund also may invest directly in startups, Gomez said. The accelerator’s founding partners include Lincoln Fish, CEO of OutCo Labs, which cultivates marijuana and operates a medical marijuana dispensary in suburban San Diego. “In a couple months, they will be by far the largest vertically integrated cannabis operation in Southern California,” Gomez said.

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Life Science Leaders Who Feel the Right Kind of Fear

Wed, 10/12/2016 - 07:00

In the world of betting on the future, life sciences find themselves in a storm, with huge opportunities, like CRISPR gene editing, and immense obstacles, such as soaring drug prices, that call for leaders of extra intensity who are imbued with a sense of crisis.

Most people agree that the life sciences today, more than 60 years after two cocky young men found a structure for DNA, point toward amazing things. These include faster prevention, detection, palliation, and cure of many diseases rather than a few. And when we see ourselves in an economy where capabilities multiply exponentially, you might think the bioscience buzzword would be: optimism.

Let me try another word: fear. By that I mean mad-as-hell, fight-back fear.

Not surprisingly that word leads straight back to Franklin Roosevelt, who made the word his own. He told us in his first inaugural in 1933 that the only thing we had to fear was fear itself. This was an injunction to himself and the entire nation. It came a dozen years after he suddenly faced the terror and despair of a crippling disease. In an ultimate personal crisis, he started fighting back. After years of flailing about looking for a reasonable answer, he used much of his personal fortune to create a health resort in Georgia where he and other “polios” could strive together in the equalizing neutral buoyancy of swimming pools. He gained enough strength to defy his mother and re-enter politics.

Just the other day I reread a passage from volume 3 of Frank Freidel’s biography of FDR. After a narrow victory at the polls amid the crushing defeat of his fellow Democrat Alfred P. Smith for the Presidency, Roosevelt was sworn in as Governor of New York (Smith’s old job) on Jan. 1, 1929. A day later, he appeared at a reception in the capitol in Albany. On the arm of his Secretary of State, Roosevelt began walking across a large room. It took a long time. About halfway across, Roosevelt jerked his head up, smiled broadly, and told the crowd of uneasy onlookers, “It’s all right, I’m going to make it.”

This is the same man who as President in 1940 confronted what looked like the end of civilization. In weeks, motorized German forces had swept aside the armies of western democracy in a blitzkrieg. On the very day when defeated Allied soldiers began climbing into boats at Dunkirk, Roosevelt made a telephone call to General Motors president William Knudsen in Detroit, summoning him immediately to Washington to “work on some production problems.” Roosevelt wanted immediate help to energize the crucial element in crushing a triumphant Hitler—production. It’s a bit uncanny that Roosevelt, after a decade of fighting the Depression, knew what the world’s top problem was, and whom to call to his side.

Today, it seems clear that the problems biologists and medical people are tackling are pretty close to the top challenges faced by the world—with three times more people than 75 years ago. And then as now, a lot of people talk about our problems as too tough for fractious humans.

Yes, the techniques of modern biology, which I’ve been covering as a journalist for over half a century, are immensely more numerous and powerful than they were. But the social and technical challenges, including food, environmental protection, and human health, are also overwhelming.

Which diseases are more important? Infections striking the young particularly hard, or the chronic diseases that afflict an aging population? Which are the really crucial insights that deserve urgent attention? Which are the most important tools for asking the right questions?

The other day, I was reminded that we need to appreciate that genes are as important as electrons. Such issues, which are sure to reshape such institutions as research universities, are bigger and more urgent than most realize. We need leaders who feel the heat of the blowtorch, who are determined to achieve focus—just as we did in World War II.

When we confront health crises today, I think there’s a case for being afraid, very afraid. Besides the onset of genetically influenced dementia as the world’s population ages, we can think of an infectious disease like AIDS, which has killed 30 million in 35 years, but which also has been managed so that 30 million more live with the disease—thanks to a triumph of modern biology. There are frightening numbers of people who don’t know they carry HIV and can infect others.

So we need leaders in the life sciences who can describe, frame, and focus on the crises. These leaders have to help the rest of us to hold in our minds two things at once: urgency, and patience for the work of decades.

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San Diego Startups Raise $287M in Third Quarter, and Top 10 Deals

Tue, 10/11/2016 - 09:38

Venture Capital investments in San Diego startups fell by roughly a third during the three months that ended September 30, according to data released recently by Seattle-based PitchBook and the National Venture Capital Association.

VC firms invested $280.6 million in 49 startups in San Diego County during the third quarter, according to a breakout of data provided by PitchBook as part of the inaugural “Venture Monitor” report.

That was 32 percent lower than the $414.4 million that venture firms invested in San Diego during the prior quarter, although the deal count was up by 10 percent from the 39 companies that received funding. The latest quarter also was down by 33 percent from the same quarter in 2015, when VCs pumped $420.3 million into 61 local companies.

In the biggest deal of the quarter, Carlsbad, CA-based Ostendo Technologies raised $42 million in mid-July to advance its virtual reality display technology.

As Xconomy reported last week, third-quarter venture funding also slipped nationwide to $14.99 billion in 1,810 funding deals in 1,796 companies. Here is a list of San Diego’s top 10 deals of the quarter, based on PitchBook data:

Ostendo Technologies Carlsbad, CA $42 million Tealium San Diego $35 million Singlera Genomics San Diego $20 million Avelas Biosciences San Diego $20 million Fortis Therapeutics San Diego $18 million Histogen San Diego $16 million Medsphere Systems Carlsbad, CA $15 million CellSavers San Diego $15 million Progenity San Diego $12 million AristaMD San Diego $11 million


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How Doctors Think About Drug Prices

Tue, 10/11/2016 - 09:30

There are a lot of factors involved in drug pricing that don’t enter my head when I’m seeing a patient. The three letters “PBM,” for example (pharmacy benefit manager), have never crossed my mind when I’m writing a prescription. Nor has the word “rebate.” Or the phrase “pay for delay.” Or “marketing exclusivity.”

Basically, I only care about two things: (1) Is there a good drug available to treat my patient’s condition, and (2) Can my patient afford that drug. If I can answer “yes” to both questions, I will be happy. If either one of the answers is a “no,” I will feel like our system has failed my patient.

Simplistic as this framework is, it goes a long way to describing how we should think about drug pricing.

Scenario 1: A good drug is available but is not affordable. If there is a good drug available, it is everyone’s responsibility to make sure patients can afford it. I don’t have the space or patience to delve into all the drug pricing hullabaloo related to companies like Mylan and Valeant here. Suffice it to say that drug companies should set a price that is within reason. While a coarse tool, cost effectiveness analysis should play a large role in determining a fair price. If the price is reasonable, payers should cover it.

A good example is antiviral treatment for hepatitis C infection. The old treatment for hepatitis C virus consisted of ribavirin and interferon, fairly cheap drugs that were both toxic and ineffective for too many patients. So when Gilead and other companies came out with safe and effective treatments for hepatitis C, they were right to set the price high. In fact, analyses have shown these drugs to be cost-effective in almost all scenarios. Drug companies and patients are right to have fought states and insurers who refused to cover these antivirals.

Insurers have pointed out that they are at risk of insolvency if they cover all patients with hepatitis C. While this may be true, it is not the drug companies’ responsibility to keep insurers solvent. The federal government can create a fund to lend money to payers to spread the costs of these drugs over many years—or perhaps Gilead and others could use all their excess cash to lend the money directly to insurers who cover their drugs, spreading their windfall over more years in exchange for broader coverage.

Scenario 2: Several good drugs are available. Only some are affordable. This is basically the situation with cholesterol-lowering drugs. There are two classes of drugs that are very effective at lowering LDL (bad) cholesterol: statins and PCSK9 inhibitors. Statins have been around for over a decade and are now available as generics for a few dollars per month. PCSK9 inhibitors only got FDA approval a year ago and cost around $1,000 per month.

In almost all cases, statins get a “yes” for both of my key questions: They are effective at lowering cholesterol and preventing deaths, and they are affordable. While PCSK9 inhibitors seem to be effective (some key trials are still pending), they are not affordable for most patients because insurers do not cover them unless a statin wasn’t enough. Do I care that these drugs are not affordable? Not really. Except in rare cases, the statins work perfectly well. Only patients with extremely high cholesterol or risk of heart disease need the PCSK9 inhibitors, and in these patients the drugs are covered by insurance.

Scenario 3: There are no good drugs available. This is not a drug pricing problem. It is a scientific innovation problem. In these cases, the government can help by funding basic research through the NIH, and the FDA must release the brakes on drug development. Since 2003, the NIH budget has decreased by 22 percent, creating a vacuum in basic science research that will cut into drug development for decades. The FDA, on the other hand, has taken bolder steps to expedite approval for drugs that could represent major improvements over existing therapies. Through the fast track, breakthrough therapy, accelerated approval, and priority review programs, the majority of drugs approved today receive some form of expedited regulatory treatment to help reach the clinic faster.

The third scenario is, of course, the most painful. For a doctor it is excruciating to tell a patient I have nothing to offer them; I can only imagine how it must feel as a patient. We should do whatever we can to support scientists and drug companies working to develop treatments for these conditions. When new drugs are developed, we must be prepared to pay for them at a fair price determined through cost effectiveness analyses. On the front line of healthcare, the shenanigans employed by drug companies, insurers, PBMs, and others are all irrelevant at the moment the prescription is written and the patient gets the right treatment.

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Checkpoints In Lung Cancer, and Other Oncology News From Europe

Tue, 10/11/2016 - 04:00

The European Society for Medical Oncology’s annual conference wraps up in Copenhagen today. We’ve seen updates on heavyweight immunotherapy programs, potential options for patients with advanced breast cancer, and more. Here’s a quick roundup of the major news.


ESMO provided more evidence that the treatment of lung cancer is changing fast. Going into the meeting, pembrolizumab (Keytruda) from Merck (NYSE: MRK) had already leapfrogged (NYSE: BMY) nivolumab (Opdivo) from Bristol-Myers Squibb (NYSE: BMY) in the race to make checkpoint inhibitors, a type of cancer immunotherapy already approved for hard-to-treat skin, bladder, lung, and liver cancers, the standard of care for newly diagnosed lung cancer patients.

The first news of nivolumab’s Phase 3 failure in these first-line patients came in August and eliminated billions of dollars from Bristol’s market value. Conversely, Merck got a boost. At ESMO this weekend it reported more positive Phase 3 pembrolizumab data, particularly in patients whose tumors express high levels of a protein called PD-L1, while Bristol detailed nivolumab’s poor Phase 3 showing. (Both were compared to chemotherapy.)

Evercore ISI analyst John Scotti wrote in a research note that Bristol’s data were “even worse than expected,” widening the gap between the two drugs. Merck’s shares rose 1.6 percent Monday to close at $63.80 apiece, and Bristol’s fell 10.3 percent to $49.72. has more on the data here.

Merck is expected to seek FDA approval of pembrolizumab in newly diagnosed lung cancer patients this year.

—Meanwhile, Roche’s Genentech division reported that its checkpoint blocker atezolizumab (Tecentriq) posted positive Phase 3 results in non-small cell lung cancer patients whose disease progressed after at least one round of chemotherapy. The FDA could approve atezolizumab for this group of patients within the next few weeks. The FDA approved atezolizumab earlier this year for a type of bladder cancer.


—Among the three developers of CAR-T cell therapies pushing toward the field’s first approval, Kite Pharma (NASDAQ: KITE) was the sole presenter at ESMO. Santa Monica, CA-based Kite noted that three patients whose non-Hodgkin’s lymphoma was wiped out with Kite’s KTE-C19 remained in remission after 12 months. Kite recently reported that a larger group of NHL patients had a similar response to KTE-C19 after three months. CAR-T treatments use live, modified immune cells to attack a patient’s cancer.

—Adaptimmune (NASDAQ: ADAP), which is developing a form of cell therapy called T-cell receptor (TCR) therapy, updated its most advanced clinical program, a treatment for synovial sarcoma, which is a rare cancer that forms in the soft tissues around joints.


—ESMO was also the latest forum for data for cancer drugs known as PARP inhibitors. These drugs disable a mechanism that tumor cells use to repair their own DNA. The idea is to keep cancer from bouncing back after chemotherapy. The first PARP blocker to win approval was AstraZeneca’s olaparib (Lynparza), for certain forms of ovarian cancer, in 2014. But more seem poised for a green light.

Tesaro (NASDAQ: TSRO), of Waltham, MA, for instance, could win FDA approval of niraparib next year and make an impact on the treatment of ovarian cancer. Right now, surgery is the main option, followed by chemotherapy. But the cancer is stubborn, and there is a big need for “maintenance therapy”— drugs that delay the cancer’s recurrence. Phase 3 data from Tesaro show that adding niraparib to chemotherapy helps delay recurrence compared to chemo alone. Tesaro released top-line data from this trial in June, and investors cheered the better-than-expected results.

The company released detailed data at ESMO and published the results in the New England Journal of Medicine. The data solidified Tesaro’s case that nirapirib appears to help a broad group of ovarian cancer patients, not just those with a particular biomarker making them more likely to respond to treatment. (News that the drug might not need a companion diagnostic test from Myriad Genetics (NASDAQ: MYGN) sent the Salt Lake City test maker’s shares down more than 11 percent.) Tesaro expects to file for approval of niraparib next year. Some 20,000 women in the U.S. and Europe each year are eligible for maintenance therapy, according to Tesaro. Shares of the company climbed another 18 percent and closed at $117.90 apiece on Monday. Here’s more from OncLive.

—A rival PARP drug, rucaparib from Clovis Oncology (NASDAQ: CLVS), of Boulder, CO, didn’t fare as well this weekend. Clovis touted data from a “pooled” study of two mid-stage trials of rucaparib in ovarian cancer. The results, as Bloomberg noted here, underwhelmed investors, who sent Clovis shares down about 20 percent. Clovis aims to win FDA approval of rucaparib next year, and has recently been the subject of takeover speculation, which has caused shares to climb over the past several months. Pfizer, after all, paid $14 billion for Medivation earlier this year partly for a PARP drug in Phase 3 testing.


—Novartis revealed in May that its breast cancer drug ribociclib did so well in a 668-patient Phase 3 trial that the study was halted early. Novartis gave more details at ESMO and in the NEJM: Compared to the standard of care letrozole, ricociclib plus letrozole improved by 44 precent first-line patients’ chances to live without their cancer starting to grow again. The drug is meant for hormone dependent (HR+/HER2-) breast cancer and could compete with Pfizer’s palbociclib (Ibrance), which blocks the same cancer proteins, CDK 4 and 6, as ricociclib. Forbes weighed the ricociclib side effects here against the benefits of living longer without a growing tumor.

—Alex Lash contributed to this report

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Echo Labs Wins “Quick Pitch” Contest with Digital Hybrid Microscope

Mon, 10/10/2016 - 16:28

By popular acclaim, San Diego-based Echo Laboratories founder Eugene Cho claimed top honors, and a $15,000 check, for his two-minute presentation last week in the 10th annual “Quick Pitch” competition, hosted by San Diego’s Tech Coast Angels.

Cho made his case for Revolve, a digital instrument created for biology labs that combines the features of an upright microscope (for viewing glass slides) and an inverted microscope (for viewing live samples in a petri dish). The hybrid microscope also replaces conventional microscope eyepieces with an iPad, enabling users to view digital, high-resolution images and send them to caregivers or save them in the cloud.

Cho, a former sales manager for Nikon Instruments and Vala Sciences, founded Echo Labs in 2014. He told the audience Revolve sales had generated $1.8 million in nine months.

Revolve hybrid microscope combines the features of an upright microscope and an inverted microscope. (Echo Labs image)

The San Diego angels group also awarded a $10,000 cash prize for second place to Braykion, which has developed a wearable device for hospital caregivers. Braykion CEO Jon Wilensky said the smart wristband is intended to help prevent the spread of hospital-acquired infections by tracking whether doctors, nurses, and other caregivers are washing their hands before they interact with patients, who would also be wearing a Braykion wristband.

The angels group gave a $5,000 third-place award to Pelv-ice for “Mama Strut,” a soft brace for soft-tissue trauma patients, such as new mothers following delivery. Founder Jill Bigelow (who is not related to me) said the brace includes a removable heat or ice pack feature that provides increased mobility, mood, and birth satisfaction.

It was the first time the San Diego angels group has enabled the audience to choose the winners of its signature event, the John G. Watson Quick Pitch Competition, which attracted over 400 people to the Jacobs lecture hall at Qualcomm (NASDAQ: QCOM) headquarters. After each entrepreneur’s pitch, 10 judges scored the  presentation and offered their feedback from the stage. The audience used text messaging to vote for their favorite presentation.

“We wanted the judges to be influencers, but ultimately it’s the audience that votes on the winners,” said Millard Chan, a San Diego TCA executive board member.

It also was the first time the angels group awarded cash prizes for second- and third-place winners, according to Sergio Gurreri, the local TCA president.

Crowd Gathers for San Diego Tech Coast Angels “Quick Pitch” Competition

The event reflected the efforts of a new generation of angel investors that has moved onto the group’s executive board, Gurreri said. The San Diego group also hired its first executive director, Ashok Kamal, and has been working to improve its operations by restructuring and streamlining its due diligence process.

“We’re getting more investors, we’re getting a lot of good companies, a lot of good deals, and we’re now syndicating our deals nationwide,” Guerreri said. A record 140 startups applied to compete in this year’s Quick Pitch event as a result.

Other finalists that presented at the Quick Pitch competition:

CourseKey has developed technology that enables university professors and other teachers to use smartphones, tablets, and laptop computers to increase student participation. CourseKey’s software automatically tracks student attendance, shares key information, and sends pop quizzes to students’ devices.

Industry has developed career and social networking software focused specifically on jobs and workers in restaurants, bars, nightclubs, and hotels—known collectively as “the industry.”

—In Spirit is a craft cocktail startup that has invented technology that separates cold-pressed juices from spirits, bitters, and artisanal syrups in the same bottle—enabling consumers to mix their own cocktails.

Librede is an industrial biotech that uses yeast to produce cannabinoid compounds (the same natural chemicals found in marijuana) in fermentation tanks. CEO Jason Poulos said industrial biotechnology can produce cannabinoid compounds used in pharmaceuticals and “nutraceuticals” more efficiently than agricultural production.

ResortPass, an online booking platform that enables hotels and luxury resorts to sell one-day access to underutilized spas, pools, and other amenities.

Throtl, a search engine and online marketplace for auto enthusiasts. Throtl is targeting the 1.75 million car enthusiasts who spend $11.5 billion a year on used cars and specialized auto parts.

—Vor has developed a handheld device for rapidly detecting harmful bacteria in food. Founder Winston Chen said the test would enable suppliers to avoid costly recalls, and help U.S. consumers avoid 48 million illnesses, 3,000 deaths, and $15.6 billion in medical expenses annually.

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How Augmented Reality Is Transforming the Manufacturing Industry

Fri, 10/07/2016 - 14:00

For many Americans, the manufacturing industry brings to mind images of Industrial Revolution-era factories, World War II assembly lines, or perhaps even outsourced workshops overseas. But that picture is outdated.

The truth is that the advanced technologies that are changing modern life are also revolutionizing the manufacturing industry in ways that are not yet widely understood. Since today is National Manufacturing Day, it’s the perfect time to showcase a technology that is truly transforming the industry and driving new opportunities for manufacturing in our country: augmented reality.

Augmented reality technology makes complex processes simple by placing the right information in the right place at the right time. It is particularly useful in the automotive industry, where automakers and suppliers manage a great deal of product variation and customization, often building parts for multiple vehicles on the same factory line. Equally important—particularly for healthcare manufacturers building life-saving medical devices—is the technology’s ability to fully document and trace each part built. That means that every item is guaranteed to be built perfectly, every time.

By implementing advanced augmented reality technology into established manufacturing and assembly processes, manufacturers are reducing costs, increasing efficiencies, and improving outcomes as a whole—and changing the landscape of American manufacturing. For example, an overhead mounted projector-based augmented reality system projects a digital operating “canvas” directly onto almost any work surface, providing audio and visual prompts, guidance, pacing, and direction and providing real-time confirmation that each step was completed correctly.

In this day and age, every industry in the manufacturing sector is seeking for ways to cut costs while improving quality. It’s an ambitious goal, but advances in technology are providing the much-needed leap to usher in vast improvements to common practices and standardize complex processes. By simplifying steps, using visual cues and confirming quality, augmented reality systems can allow for greater flexibility in production without the added risk for error. Its strength is its unique ability to simplify the varied and complex tasks involved in the modern manufacturing and assembly processes, reduce risk, and to bring to life the parts, pieces and products that are part of 21st century life.

An augmented reality guidance system can be mobile as well, able to move, scale, and integrate with equipment already at work on a factory floor. Manufacturing tools like programmable machine vision cameras, laser trackers, robots, and torque guns can be incorporated seamlessly to provide precision confirmation that tasks like pipe alignment, bolt sequencing, and tightening are performed correctly. A projection-based guidance system can place blueprints, instructional videos, and even a virtual tape measure for key steps directly onto the work surface, and right in front of the operator’s eye.

Supervisors can connect the augmented reality system to their cell phones and receive an update as soon as an error occurs, which in turn can drive efficiencies and identify bottlenecks. Additionally, the system automatically collects key process data, such as serial numbers, cycle times, date/time stamps, error quantity, and web cam pictures of each step in real time. The ability to measure cycle time at each step ensures that potential issues are identified quickly, while supporting a “lean” process and procedural improvements.

One of the most valuable qualities of an augmented reality system is that it can solve fundamental challenges for any number of diverse industries. For example, a common challenge for automotive manufacturers is the high degree of variation between similar components needed to assemble a vehicle. The differences in the parts are often subtle but have a large impact on functionality, and can translate into costly mistakes when mislabeled or misidentified. This issue is also crucial for the assembly of medical devices, many of which are complex and customized with an even greater degree of variation. It’s important to fit the right door to the right vehicle and critical to fit knee or hip implants to an individual patient.

Perhaps the most exciting aspect of utilizing augmented reality technology in manufacturing is not only that it reduces errors and drives efficiencies, but that it makes American workers more productive, keeps manufacturing jobs alive, and provides a tool to bring jobs lost to other countries back to the Unites States. That’s because unlike many automated systems, augmented reality integrates human intelligence with software, operating in collaboration with a real, live person.

An augmented reality system can eliminate the need for monitor-based or written work instructions, allowing personnel to keep their eyes on the task at hand rather than on a cumbersome manual. An intelligent and intuitive augmented reality guidance system brings an increased level of engagement in the manual assembly process and pairs the best of human ingenuity and ability with the precision of technology—and that’s exactly what we need to get the country’s manufacturing sector humming.

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Bio Roundup: Theranos Cuts, Alnylam Stops, Nobel Eats Its Own & More

Fri, 10/07/2016 - 07:30

[Updated, 11:50 a.m. ET, see below] With the Caribbean and now the southeast U.S. coast bearing the brunt of Hurricane Matthew, we send our thoughts and more to those who have more pressing matters to worry about this week. But the show must go on. The biotech industry saw its own storms pass through, with Theranos, Alnylam Pharmaceuticals, and Merrimack Pharmaceuticals taking direct hits. Nobel Prizes were also in the air, and DARPA said it would make it rain for biosecurity innovation. To check the latest life sciences forecast, let’s get to the roundup.


—After months of playing defense, embattled blood-test maker Theranos announced late Wednesday it would shut down its clinical labs and in-store “wellness centers,” laying off 340 employees. Regulators this summer ordered Theranos to shutter its main lab in Newark, CA, which Theranos said it would appeal. The firm will now focus on its miniLab, which CEO Elizabeth Holmes touted as a follow-on version of its Edison test system at a scientific conference in August. She refused to discuss Edison at the time.

—Alnylam Pharmaceuticals (NASDAQ: ALNY) of Cambridge, MA, said that it would shelve its drug revusiran after 18 patients died in a Phase 3 study to treat the rare disease transthyretin amyloidosis. Officials declined to say how many of the 18 were taking the drug and how many were on placebo. Shares immediately fell more than 40 percent.

—The U.S. military’s high-tech think tank DARPA described Safe Genes, a new program to fund safety measures that can be built into genome editing technology or counter its potential wayward effects. The funding could be as much as $100 million, and the first grants will be announced in 2017.


—The 2016 Nobel Prize for Physiology or Medicine went to Yoshinori Ohsumi of the Tokyo Institute of Technology. He discovered and elucidated autophagy—“self-eating”—a process cells use to destroy their own damaged components, fight invaders, and more.

—The Nobel in Chemistry went to three scientists, in France, the Netherlands, and the U.S., for their work on molecular machines.


—The Institute for Clinical and Economic Review (ICER), whose drug-value analyses set the pharma industry’s teeth on edge, issued a new report on PD-1 inhibitors, part of the first wave of cancer immunotherapy drugs to be approved. With some caveats, ICER recommended lower prices.

—Meanwhile, in the wake of the Mylan hearings, the Wall Street Journal this week was the latest outlet to record the animosity between drugmakers and pharmacy benefit managers, the middlemen who buy drugs in bulk for large employers and other insurance payers.

—[Updated with new item] Shares of Sarepta Therapeutics (NASDAQ: SRPT) slid more than 7 percent Friday after health insurer Anthem (NYSE: ANTM) declared Sarepta’s Duchenne muscular dystrophy drug eteplirsen (Exondys 51), which costs an average of $300,000 per patient for a year of treatment, “investigational and not medically necessary.” Here’s more on the questions insurers face regarding Sarepta’s drug.


—Separately, Sarepta struck a second deal in as many weeks to develop combination therapies for Duchenne.

—Ra Pharma filed for an IPO, looking for more cash as it prepares to take on rare disease drug developer Alexion Pharmaceuticals (NASDAQ: ALXN).

—Merrimack Pharmaceuticals (NASDAQ: MACK) announced layoffs of 22 percent of its staff and the resignation of CEO Robert Mulroy.


—Longtime partners Regeneron Pharmaceuticals (NASDAQ: REGN) and Sanofi (NYSE: SNY) reported positive news for dupilumab in a Phase 3 study to treat atopic dermatitis, a severe form of eczema. The FDA could make an approval decision next spring.

—Johnson & Johnson (NYSE: JNJ) said its psoriasis treatment guselkumab fared better head-to-head against adalimumab (Humira), which is the world’s best-selling drug thanks to its use in several autoimmune diseases.

—A dozen major medical centers will team up to run an unorthodox and very large “precision medicine” pancreatic cancer study.


—Indiana: The Eli Lilly (NYSE: LLY) animal health division Elanco is buying Boehringer Ingelheim’s Vetmedica, which makes animal vaccines, for $885 million.

—San Diego: Biotech firm Sirenas reeled in a grant from the Bill and Melinda Gates Foundation to extract chemicals from marine organisms that might treat neglected diseases.

—Wisconsin: On the heels of a big split, stem-cell pioneer Cellular Dynamics International will spin out a new company that aims to treat retinal disease.

—The guy who took Alzheimer’s drug developer Axovant Sciences (NASDAQ: AXON) public at record levels is now pushing a new company, Myovant Sciences, toward an IPO.

—Another week, another Allergan (NYSE: AGN) deal: $250 million to AstraZeneca for rights to an experimental drug to treat Crohn’s disease and ulcerative colitis.


—Two Xconomy biotech events are on the fall calendar. At MIT, we will showcase a series of talks with Boston-area scientists, investors, and executives. In December we’ll gather in San Francisco to discuss the U.S. election’s effect on national biotech and health issues.

Image “U.S. Territorial Acquisitions” by Joaquin Martinez via Creative Commons.

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Brain Corp.’s First Product Is a Brain for Floor-Scrubbing Machines

Fri, 10/07/2016 - 01:01

San Diego’s Brain Corp. has a vision for developing the kind of technology that could some day be used to operate self-driving cars. Before getting out on the open road, however, the company wants to show its self-driving system can clean up a mess in aisle 3 at Jimbo’s.

As an independent startup backed by the corporate venture arm of Qualcomm (NASDAQ: QCOM), Brain Corp. began life in 2009 with a lofty goal of reverse-engineering the human brain.

Headed by the computational neuroscientist Eugene Izhikevich, the company maintained a low profile at Qualcomm’s San Diego headquarters until 2013, when Brain Corp. emerged in the collective glow of the Obama Administration’s brain initiative. The startup moved off-campus in 2014, with $11 million in funding from Qualcomm Ventures.

Like many startups, Brain Corp. meandered quite a bit as it sought to find a way to commercialize its technology, with substantial turnover among its ranks.

But now Brain Corp. is rolling out its first commercial product—a “brain-enabled” commercial floor scrubber that is part mini-Zamboni and part Roomba. As an example of advanced AI technology, it’s not particularly sexy or glamorous. But as a pragmatic industrial product, Brain Corp. stands to gain valuable experience toward the development of autonomous, machine-learning systems and self-driving cars.

“The area we’re focused on initially is the retail industry—big box retailers, malls, and airports,” said Phil Duffy, who joined Brain Corp. two years ago as vice president of marketing and product development. By working with several manufacturers of commercial floor cleaners, including International Cleaning Equipment (ICE) of Holland, MI, Duffy said Brain Corp. has developed a “brain module” that can be installed on manually operated floor scrubbing machines like the ICE RS26.

Transparent image shows Brain Corp. components in orange in floor-scrubbing machine.

Brain Corp. has designed its technology to be “hardware and sensor” agnostic, so that similar modules could be installed in forklifts and other manually operated industrial equipment, Duffy said.

Where self-driving technologies under development at big tech companies like Google (and at car-makers like Audi and Mercedes-Benz) must master the automotive rules of the road, including construction zones and ill-defined lanes, Brain Corp.’s approach is similar to Amazon Robotics (previously Kiva Systems). Indoor environments can be easier to navigate, but robots must contend with more random obstacles and frequent human encounters.

Brain Corp maintains that its vision-based A.I. technology can navigate through big retail outlets, warehouses, and schools, without relying on GPS or making any modifications, such as installing magnetic sensors in the floor, to keep the machine on course.

With Brain Corp’s module installed, a floor-scrubbing machine can operate either with a human driver or in self-driving mode.

The system is designed so that a human driver “trains” the module to operate autonomously by simply driving the floor-cleaning route. The module follows the same route. The process does not require the installation of separate mapping or navigation software, or the on-site assistance of Brain Corp. engineers, Duffy said. The company actually has been test-driving its technology on floor scrubbers used to clean Jimbo’s, a San Diego natural foods grocer.

“We have an intelligent system that can follow a prescribed route, but if there are people stocking shelves and moving goods around, it stops, observes, and re-routes,” Duffy said. Using laser and sound-based sensors and cameras, the system also can tell the difference between humans and shopping carts or boxes, and takes a wider detour around human obstacles.

Each unit also maintains a wireless connection to Brain Corp.’s robotic operating center, which monitors operations and collects analytic data. “A year from now, when we have hundreds of machines in hundreds of stores, we’re going to apply collective learning algorithms, so the machines can clean better than the janitors do,” said John Black, who joined Brain Corp. last October as vice president of engineering.

John Black trains self-driving system of floor-scrubbing machine

Familiarity with the machinery is an advantage, Duffy said, because “These are the same kind of machines that [retailers] have been buying and using for years.”

While Brain Corp. maintains that its module is cost-effective, Duffy said the company is waiting to disclose its pricing at the upcoming International Sanitary Supply Association trade show in Chicago. Prices for a manually operated ICE RS26 floor-scrubbing machine range from roughly $16,000 to $18,000, janitor not included.

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Third-Quarter Report Shows Slowdown in VC Activity, & Top 10 Deals

Thu, 10/06/2016 - 01:01

Venture capital activity is gradually easing from last year’s peak, according to a new quarterly report put together by Seattle-based PitchBook and the National Venture Capital Association.

VC firms invested $14.99 billion in 1,810 U.S. deals (1,796 companies) during the third quarter that ended September 30, according to the inaugural “Venture Monitor” report released today.

It was the fifth straight quarterly decline in the number of companies getting VC funding, according to the report. Third-quarter funding fell by nearly a third from the prior quarter, when venture investors deployed $22.14 billion in 2,034 deals (2,026 companies).

PitchBook data also shows a nearly 29 percent decline in year-over-year funding, from the $21.1 billion that was invested in 2,559 deals (2,545 companies) in the third quarter of 2015.

Despite the slowdown in venture dollars and deal flow, 2016 is still on pace—with roughly $56 billion invested in 5,997 deals so far this year—to end the year with more than $70 billion invested nationwide. That would be second only to the $78.9 billion that venture firms invested in 2015, according to PitchBook records that began in 2000. Meanwhile, this year’s deal count is declining sharply, a sign that venture investors are still writing bigger checks for fewer deals.

In a Venture Monitor statement today, PitchBook founder and CEO John Gabber said, “Promising companies like Moderna Therapeutics, Zoox, and OfferUp have demonstrated that quality targets are having no trouble closing sizable financing rounds.” (A list of the quarter’s top 10 deals is below.)

Venture capital firms also are having no trouble raising funds. According to Venture Monitor, VCs have raised $32.4 billion in 201 funds so far this year. Six of those funds have raised at least $1 billion this year, including $2.5 billion raised by Technology Crossover Ventures’ Internet fund and $1.6 billion raised by Andreessen Horowitz.

Software companies continue to attract the most attention from venture investors, with 2,122 companies drawing in roughly $27 billion so far this year and accounting for nearly half of all invested capital.

Exits by venture-backed companies continue to decline, with 162 exits of all types generating $14.6 billion in liquidity for VCs during the third quarter. Strategic acquisitions and buyouts accounted for 91 percent of all venture-backed exits last quarter, according to Venture Monitor.

Through the third quarter, venture firms have realized $38.6 billion from exits so far this year.

Angel investors in seed-stage deals accounted for just over half of all the financings, with early stage deals accounting for 30 percent and late-stage deals accounting for 19 percent of the total deal flow.

Here is a list of the top 10 deals of the quarter, based on PitchBook data:

Moderna $474 million (Late) Cambridge, MA Pharma/Biotech Solar Mosaic $220 million (Series C) Oakland, CA Financial Zoox $200 million (Series A) Menlo Park, CA Transportation FreshDirect $189 million (Late) Long Island City, NY Retail Carbon $181 million (Series C) Redwood City, CA 3D Printing Unity Technologies $181 million (Series C) San Francisco, CA Software StackPath $180 million (Series A) Dallas, TX Software Compass Therapeutics $170 million (Series A) Cambridge, MA Pharma/Biotech MetroMile $153 million (Series D) San Francisco, CA Insurance Draft Kings $153 million (Late) Boston, MA Software


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With New Program, DARPA To Encourage Safety “Brakes” For Gene Editing

Wed, 10/05/2016 - 15:18

[Updated 10/6/16, 12:17 p.m. See below.] Drugs that use molecular scissors to snip out or replace defective genes. Altered mosquitoes meant to sabotage entire disease-carrying populations. Both are potential uses of genome editing, which thanks to the CRISPR-Cas9 system has spread throughout the world’s biology labs and is now on the doorstep of the outside world. But with its first applications could also come unintended consequences for human health and the environment. The U.S. Defense Advanced Research Projects Agency—a famed military R&D group—wants to finance safety measures for the new gene-editing age.

The idea for the funding program, called Safe Genes, is to get out ahead of problems that could bring the field to a screeching halt. “We should couple innovation with biosecurity,” DARPA program manager Renee Wegrzyn, said Tuesday at the SynBioBeta conference in South San Francisco. “We need new safety measures that don’t slow us down. You have brakes in your car so that you can go fast but can stop when you need to.”

Safe Genes is meant to fund three areas of research: techniques that allow gene editors to be switched off and back on again once inside a person or organism; development of drugs and other agents to block or reduce the action of gene editors; and tools to clean up environmental genomic “spills” and leave things as they were before—which will be a big task, said MIT researcher Kevin Esvelt, who is vocal about the dangers of gene editing moving too fast and in secrecy.

“No current CRISPR-[Cas9]-based system can return the population to its baseline state the way they are requesting,” Esvelt told Xconomy. He praised DARPA for looking to fund “safety first, rather than jumping to fund unsafe work with only a handful of potential applications.”

Esvelt co-authored a Nature paper last year describing new safety guidelines for scientists who are exploring a controversial technique called gene drive, which introduces DNA modifications that quickly spread through a population of fast-breeding organisms, like mice or mosquitoes. (Some see it as a way to eradicate malaria.) The Nature paper also described a way to reverse a gene drive in a yeast population.

DARPA did not fund the work, which is the only effort of its kind, according to Wegrzyn.

Safe Genes was announced last month. The funding pool is undisclosed, but Wegrzyn told Xconomy that it’s similar to other DARPA programs, which range from $50 million to $100 million. The final total will depend in part upon the quality of the proposals that come in, Wegrzyn said. The agency wants to fund projects for four years, to the point they can be handed off to investors or other government agencies. The first round of pitches are due this week. Wegrzyn expects to announce the first grants in late spring or early summer of 2017. [Updated with grant announcement information.]

Megan Palmer, a fellow and biosecurity researcher at Stanford University’s Center for International Security and Cooperation, hoped DARPA’s program would encourage a more holistic approach to biosafety in a growing field where many people, such as software engineers, might not have thought much about biosafety and security risks. “DARPA is saying you can’t retrofit [biosafety] into existing technology, you have to design it—not just into widgets and technologies, but into the institutions that are supporting the technologies.”

At the conference, FBI supervisory special agent Ed You told the audience the bureau is aware of the need for new biosecurity measures. “Traditional conversations around biosecurity—dangerous bacteria, viruses—don’t work in this space,” said You, who works in the bureau’s Weapons of Mass Destruction Directorate.

“How to address emerging applications that don’t deal with pathogens” is a key question, You said. “We have a window of opportunity to start incorporating security measures on the front end.”

One kind of gene editor, called zinc fingers, has already begun tests in humans as a treatment for HIV infection. But this decade’s frenzied development of the editing system CRISPR-Cas9 could soon bring a wave of human therapies into clinical trials. Editas Medicine (NASDAQ: EDIT), Intellia Therapeutics (NASDAQ: NTLA), Crispr Therapeutics, and their high-profile development partners are all developing medicines that use CRISPR-Cas9 to fix genetic defects. Before they can test their products in humans, they will have to show regulators that the CRISPR-Cas9 scissors don’t cut a patient’s DNA in the wrong places—or that if they do, the risk to the patient (triggering cancer, for example) is outweighed by the potential benefit of the therapy. Editas, which could be the first of the group to begin human studies, wants to start a trial for a rare eye disease in 2017.

Wegrzyn cautioned that creation of the Safe Genes fund is not meant to imply that current strategies cannot succeed. Editas’s approach to safety, she said, is a “thoughtful design.”

Some academic researchers and biotech firms are building safety nets into other cutting-edge therapies. Genetically engineered T cells that are infused into a patient so that they can multiply and attack cancer pose a risk of attacking healthy cells or causing other dangerous side effects. One idea, not yet tested in humans, is to add “suicide genes” to the T cells. If they go awry, they could be killed by giving the patient a pill.

But killing T cells running amok in a patient is different than blocking or reversing genetic modification that has begun to run its course. “There is nothing specific out there to shut down a gene editor,” Wegrzyn said.

Photo of DARPA headquarters courtesy of DARPA.

[A previous version of this story featured a photo of the old DARPA headquarters. The agency moved to Ballston, VA, in 2012.]

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